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Politics : Welcome to Slider's Dugout
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easygoer
From: Hugh Bett7/15/2025 10:25:34 PM
1 Recommendation   of 50177
 
The Trump Economic Escape Plan
Trump/Bessent have a plan. It is a multi-prong plan for the US to grow out of our debt situation. We have been talking around the elements as if they aren't related. Why not draw them together at least once for our discussion?

Here are some elements:

1. Reduce expenditures: This is first step in any attempt to correct a debt problem...stop the bleeding. This is the goal of budget cuts by DOGE and the Big Beautiful Bill. Big government uniparty types are resisting at every turn. Who will win is debatable but the problem will never be fixed if we can't flatten the spending.

2. Increase revenue: We need to take in more money without hamstringing the American taxpayers. This is the goal of the tariff program. If the US can extract ~10-15% tax on our trade with the entire world, we will increase annual revenue by hundreds of billions without raising taxes on Americans. Perhaps some of that ~10% will be absorbed by foreign producers that still want access to our markets.

3. Foster domestic growth: We need to generate more revenue domestically. The Big Beautiful Bill,"Drill Baby Drill", reduced governmental red tape, lower income taxes, and lower interest rates are all intended to supercharge the US economy and generate higher tax revenue. This is also where foreign investment matters. Trump claims to have ~$14 trillion committed from foreign investors. Of course, not all will materialize...but even a fraction would have a highly stimulative effect on every town in America...more tax revenue.

4. Refinance debt: Jerome Powell will resign or be removed soon. The new Fed Chairman will lower interest rates even with inflation bubbling. Each 1% interest on the national debt cost the nation ~$360 billion annually. Trump wants interest rates lowered so we can refinance the debt at lower long-term rates. Perhaps ~3%.(or even lower). He usually gets what he wants.

5. Manage the chaos: Of course inflation will rage...that's good unless it spins out of control. We want a "weaker" dollar as long as it doesn't go too far. What if the US economy could grow at 5%-10% for even a couple of years? The impact would be enormous. This is what Bessent has in mind...the old CBO ways of thinking aren't in his equation. He wants to "manage the chaos". It may not work but this is what he's going to try. With the global establishment pulling every lever to stop him.

The plan has many additional facets but these are some obvious ones. We can debate the wisdom/stupidity and likely success or failure but at least it's a plan.
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